Formal coalition talks between the Independence Party, the Reform Party and Bright Future begin today, according to RÚV. On Friday afternoon, Icelandic President Guðni Th. Jóhannesson gave Independence Party Leader Bjarni Benediktsson the mandate to form a government. Informal talks had taken place prior to that between the leaders of the three parties, who reported making more progress than in previous talks following the October 29 election.
Reform Party Leader Benedikt Jóhannesson told Stöð 2 TV last night that he expects a new government to be announced by the end of the week.
Fréttablaðið reports that a solution has been found in all major issues on which party leaders had previously disagreed. That includes an agreement to hold a referendum on whether to resume negotiations with the European Union regarding potential membership. In the area of fisheries, the parties have reportedly agreed to auction part of the fishing quota every year to ensure that a market price will be obtained for the quota. In agriculture, tariffs will be reduced on chicken and ham, and tariffs on cheese and other agricultural products will be lowered incrementally. A periodic revision of the agriculture agreement will take place, and MS Iceland Dairies will no longer be exempt from anti-trust laws.
Meanwhile, mbl.is reports that leaders of the Progressive Party and the Left-Green Movement have been engaged in negotiations regarding the possibility of forming a coalition with the Independence Party. Bjarni Benediktsson is said to be aware of that idea.